Hands-free homes, ‘skinny scrapers’ and new property taxes? A range of experts forecast what are likely to be the biggest changes and innovations in property, landcape, architecture and interiors.
Kate Allen, FT property correspondent
The way in which property is possessed is becoming a political hot potato and this will affect many people, from second-home owners to those using offshore vehicles.
Cash is pouring into real estate because it is one of the few investment classes with a decent yield in the global economy’s current unprecedented low interest rate environment.
As wealth increasingly becomes concentrated into real estate holdings, and with cities around the world facing a growing housing affordability crisis, politicians will come under pressure to take action. The main fiscal lever will be taxation. Property can be taxed in two main ways: one-off levies on transactions and annual value-based surcharges on ownership. Variable tax rates based on the nature of the owner — with non-residents paying more — is another option for crowd-pleasing politicians. The recent move to reform stamp duty land tax in England and Wales, and the growing clamour in Scotland for land ownership reforms, are two indications of what to expect.
Other measures likely to be more widely adopted include the punitive tax rates imposed on foreign buyers by Singapore and Hong Kong, while New York’s mayor, Bill de Blasio, is considering a tax on second-home owners — the “pied-à-terre” tax.
Yolande Barnes, director of world research at Savills
Across the developed world, capital is concentrated in the hands of older, homeowning households. Globally, the generational divide between equity-rich “boomers” and equity-poor “millennials” is significant and growing. Postwar baby boomers have lived in an era of high inflation and rising incomes. This has favoured house purchase and rapid debt repayment. Subsequent generations have experienced decreasing inflation and low interest rates, while high house prices have raised the hurdles to home ownership, especially in the post-Lehman world of low loan-to-value ratios and slow debt repayment.
The consequences for the under 40s are far-reaching and structural, with no-choice renting rising fast. In the UK, we forecast the open-market rented sector will grow from 7 per cent of homes in 1989 to 24 per cent by 2019 — a huge shift with profound implications for households, investors and politicians.
We need new ways to help disenfranchised generations accumulate equity and access home ownership, while also making renting a stable, acceptable and desirable form of tenure. Doing this will present investor opportunities but may take more open minds, and borders, to fund. Doing nothing risks further disaffection and alienation among younger people with all the consequences that entails.
Liam Bailey, head of global research at Knight Frank
From London to Hong Kong, the one constant of post-financial crisis residential markets has been the ratcheting up of property taxation and restrictions on property purchases.
Some moves have been aimed at helping to refill government coffers after the economic crisis, but others are politically motivated. Affordability of housing has become a growing issue in lots of big cities, and the accusation that wealthy investors have helped push prices higher has stuck in several places. While some restrictions apply to all buyers, others are designed explicitly to penalise foreign buyers.
The UK will see the withdrawal of the capital gains tax exemption for non-residents in April, and plans are being considered in both New York and Paris to impose new taxes on second homes.
Despite these pressures, the push factors encouraging international investment among the world’s wealthy will ensure that overall purchase activity rises to record levels in 2015.
Short-term geopolitical and fiscal factors will ensure that capital flight from the world’s less stable regions will continue; while long-term trends, such as education needs, immigration and the search for safe havens, will be responsible for the most durable demand sources. Expect to see Hong Kong investors in Miami, Nigerians in Cape Town, Turkish buyers in Switzerland, Chinese in Portugal and almost the whole world in New York.
Robin Lane Fox, FT gardening columnist
The future of gardens is entwined with three of the most pernicious problems: climate change, property prices and nationalism.
Warmer seasons have brought longer autumns and more hope of growing marginally hardy beauties outdoors. One cold night, however, can still kill those half-hardy risks.
Houses cost far too much for the debt-laden graduates of tomorrow to buy one in their late twenties and begin a garden before they start a family to play in it. Under-fifties’ gardening, as a result, is likely to migrate to allotments and small, tightly packed containers.
Nationalism will continue to obstruct competent gardeners from collecting seeds and innocent cuttings abroad and bringing them home to cultivate. So much from north Vietnam’s flora or hilly Chile’s has yet to be exported for the loving care of keen gardeners. Gardening is not merely about growing “native species”.
Anna Minton, author of ‘Ground Control: Fear and Happiness in the 21st-Century City’
The housing market in the UK is not working, tied as it is to speculation and soaring property prices. The result is whole swaths of the country, particularly in the southeast, that people cannot afford to live in. These trends are accelerating, threatening the prosperity and functioning of London, where nurses, teachers and even doctors cannot afford to live. This is not sustainable, with the market-based solutions put forward so far raising property prices further.
For this reason, I think that over the next five years alternative, non-market solutions will play a key part in solving the housing crisis. For example, the historic garden city model shows it is possible to bypass speculation in land and property by using the rising land values and property prices that development creates for the benefit of the community. This was the model the garden cities were based on, where land was bought relatively cheaply outside cities and then vested in a trust for the community. With all the main political parties promising to create new garden cities, the radical economic principles that underpin this model are likely to once again be part of the solution to the housing crisis.
Jane Owen, editor of House & Home
Landscape and garden design will shift from prettification to critical defence against climate change. By 2020, China will have increased its forest area by 40m hectares. Unlike China’s previous tree-planting projects, these will be diverse rather than single species.
Rainwater-retaining systems pioneered by Singapore will spread globally. Rain gardens will become widespread, helping to soften urban areas. Green roofs, green walls and porous ground surfaces look good and help slow rainwater runoff, as demonstrated by Nigel Dunnett’s Royal Bank of Canada garden at the Chelsea Flower Show in 2013 and Melbourne’s celebrated rain gardens.
Botanic gardens will move back into the limelight. China is building between one and five botanic gardens a year in a bid to conserve plant diversity. The added focus and funds will give botanic gardens the kind of kudos and influence they had when Joseph Banks and George III created Kew gardens in the late 18th century.
Matthew Wilson, managing director of Clifton Nurseries, London
Throughout the economic downturn the “micro-economies” of cities such as London, Beijing and New York have kept developers — and landscape designers — busy with a rich stream of high-end commissions. By and large, the end results of these multimillion-dollar projects are enjoyed by only a few. Yet, change is at hand. High quality landscape design is breaking out from the confines of the domestic home and into the public domain, as developers blur the lines between private gardens and shared space. London’s Olympic Park was instrumental in this change. In Singapore, developments such as Marina One promise to place equal importance on the dollar value of land and the aesthetic value of landscape.
The planned transformation of the centre of Mesa City, Arizona, is in many respects an old-fashioned civic parks project brought up to date with energetic design and high quality execution. New York’s High Line park showed what could be done with a redundant rail line, while Vinge train station in Copenhagen is being reinvented as a transport hub and public green space. Recessionary selfishness is being overtaken by the “green shoots” of recovery.
Diana Balmori, founder of Balmori Associates
Putting the city in nature, rather than nature in the city, is a game changer in both the way we think about cities and the form they take. It will take different forms, some of which have already been built and some that are still being considered. Sejong is a city in South Korea with a special governmental zone of vast buildings, including one with a 4km-long rooftop garden that serves as a park for the ministries and agencies underneath.
Linear parks can emerge from abandoned infrastructure by taking over a street, or enhancing and widening a median. For example, the Broadway Mall area in Manhattan could become parkland. Putting a city in nature will mean using only sustainable forms of energy in its construction, maintenance and materials. It will mean integrating wildlife, plants and animals into the urban fabric by building places for them as fellow inhabitants of the city.
Eddie Heathcote, FT architecture critic
The future of architecture should be tall. The game changer at the moment is the acceptance that density means height. From New York to Hong Kong via London, the high rise is on the rise. London, once a determinedly low-rise city is growing a spiky skyline of towers — and not always good ones. New York, meanwhile, is seeing the phenomenon of the “skinny scraper”, attenuated towers reaching the clouds but giving views of a park or water. New technology — such as the new lift cable created by Finnish company Kone which allows far greater height in a single lift run — will help towers to grow higher. The trick will be to ensure that at least some of these vertical villages have room in them for other classes than the super-rich. Once towers shatter a city’s skyline, there is no going back and no future developer will build anything lower. Height is the city’s final frontier.
Victoria Manser, London-based architect
The increasing challenge over the next few years will be to make buildings zero carbon, so that they consume no more energy than they generate. The forecast last month by the World Meteorological Organization that 2014 was on course to be the hottest year on record will only increase the pressure to reduce carbon emissions.
As a result, the game changers and some of the most interesting innovations within the building industry are those that come under the description of “smart” technology. These are materials or compositions that interact with and adapt to the environment, giving architects and engineers exciting new opportunities to design “responsive” buildings. From the relatively simple double-skin façades that provide climate buffers (such as London’s Gherkin building by Foster + Partners) to the bio-reactive façades being developed by Arup, innovative façade systems are set to dramatically enhance the energy performance of buildings. Similarly, smart materials such as solar voltaic glass, self-healing concrete, shape-memory alloys and radiative cooling panels are driving forward the sustainability of construction. These innovations, backed up by sophisticated digital design and manufacturing techniques will ensure there is nothing inert about the future of architecture.
Tim Bradshaw, FT San Francisco correspondent
If 2014 was the year that the futuristic concept of a “smart home” caught on, more people will be hearing about it — and actually living with it — in 2015, thanks to an old-fashioned innovation: the power of speech.
Several products, including the Google-owned Nest learning thermostat or August’s auto-opening door lock, have hinted at the potential of connected domestic devices. Yet for each of these, there are many other gadgets that create more problems than they solve, not least because fiddling around with apps is often more complicated than simply flipping a switch. Systems such as Samsung’s SmartThings and Quirky’s Wink have tried to create a single app to control an array of internet-enabled lightbulbs, sensors and other widgets, but they remain too complex for most of us.
Voice control could offer a better solution. Apple’s HomeKit platform, set for release this year, will allow iPhone owners to talk to virtual assistant Siri to control their home. If it lives up to its promise, this hands-free approach will be more intuitive and straightforward than its predecessors. Although Apple itself is unlikely to go into the lightbulb business, other companies can buy chips that will make their products compatible with Homekit. While Nest is also pushing its own smart-home platform, few companies have Apple’s ability to cohere a disparate band of technological standards and companies into a simple, elegant user experience.
Glenn Adamson, chairman of the Museum of Arts and Design, New York
A game-changer in the design world these days is digital fabrication: 3D printers, computer-controlled machines, laser cutters, and so on. Mention this new technology to most designers and they will talk about “mass customisation” — the hope that every consumer will soon be able to make their own personalised teacup, chair, car, or even a whole house.
This assumes that digital tools are inherently democratic, putting design into the hands of the people. But, actually, the change seems to be happening much more rapidly among traditional manufacturers. Companies with experience and resources, rather than consumers, are the ones who seem to be putting cutting-edge tools to work. Examples range from the defence industry (form-fitting body armour) to the high-end market (fine watchmaking and sculpture). In all cases, the introduction of the digital is supported by established skills and ways of making things. Expect this to continue: the digital and the artisanal turn out to be ideal companions.
Patrizia Moroso, creative director of Italian design brand Moroso
Emerging markets in countries such as China will influence our projects most over the next five years. Ten years ago I went to China and there wasn’t much evidence of a thriving design scene. But now Chinese consumers are knowledgeable and keen to absorb everything. Still, you have to adapt your pieces to their culture. We need to be part of the world where the market is. Rather than saying “Italian style is this — you have to buy it”, every good business should embrace the culture and tradition of where they are setting up.
This article has been amended since publication
Illustrations by James Fryer